Which average describes typical pay
Which average describes typical pay
IP 1
7 marks
The monthly pay, in dollars, of the seven people in a small firm is \(2400,\ 2600,\ 2600,\ 2800,\ 3000,\ 3100\) and \(15\,000\) (the owner).
- Find the mean, the median and the mode.[3]
- The firm advertises that its “average pay” is \(\$4500\). Explain why this is misleading for a new worker, and state which average better describes typical pay.[2]
- The owner's pay rises by \(20\%\) and nobody else's changes. State which of the three averages change, and find the new mean.[2]
Solution:
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Answer:(a) mean \(4500\), median \(2800\), mode \(2600\) dollars (b) the owner's pay inflates the mean; the median \(2800\) is typical (c) only the mean changes, to about \(4928.57\) dollars
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